When you contemplate your estate plan, your primary focus is probably on your desire to protect and provide for your loved ones after you are gone. While these are certainly admirable goals, they should not be your only estate planning goals. In fact, planning for the possibility of your own incapacity during the course of your lifetime should be an equally important estate planning goal, especially when you consider the possible consequences of failing to plan for incapacity. Toward that end, it may help you to consider how an Overland Park revocable living trust can help you plan for incapacity within your estate plan.
Incapacity Could Strike at Any Time
One of the biggest and most common mistakes people make is failing to seriously consider the possibility of their own incapacity. People frequently equate incapacity with old age. While the natural aging process and/or conditions such as Alzheimer’s often do cause incapacity, you do not have to be a senior citizen to succumb to incapacity. On the contrary, incapacity can strike anyone at any time. In fact, the following statistics illustrate just how dangerous it can be to assume that incapacity is a problem relegated to the elderly.
- Just over 1 in 4 of today’s 20 year-olds will become disabled before they retire
- In December of 2012, there were over 2.5 million disabled workers in their 20s, 30s, and 40s receiving SSDI benefits.
- A typical 35-year-old has a 24% chance of becoming disabled for 3 months or longer during his/her working career.
- Moreover, that same worker has a 38% chance that the disability would last 5 years or longer, with the average disability for someone like him/her lasting 82 months
- 34% of people hospitalized in 2009 for stroke were younger than 65 years of age
What Happens If Incapacity Strikes?
You could find yourself incapacitated tomorrow because of a tragic accident or debilitating illness. If that were to occur, what would happen to you and your estate? Who would make crucial health care decisions for you? Who would decide where you could live? Who would control your assets and investments? Who would pay your bills? If you are married, your spouse may be authorized to make some decisions, but do not assume that marriage equals complete authority over you and your assets in the eyes of the law. Moreover, it is not unusual for other family members to disagree with the idea of your spouse making all the decisions. A parent, sibling, or adult child might feel strongly enough to initiate a legal challenge. That, in turn, could lead to a costly and protracted legal battle that could result in a rift in the family for years to come. Fortunately, careful estate planning can prevent such an outcome.
Creating an Overland Park Revocable Living Trust
One of the most popular incapacity planning tools is a revocable living trust. If you decide to use a revocable living trust in your estate plan to provide for the possibility of your own incapacity, you will appoint yourself as the Trustee of the trust and appoint the person you wish to take over control of your assets as your Successor or Co-Trustee. Your assets are transferred into the trust so you can continue to manage and control them assets as the Trustee so long as you are able. If you become incapacitated, control over the trust will shift to your designated Successor or Co-Trustee without the need for court intervention or approval. Your chosen designee will then control the trust assets during your incapacity. You will have the benefit of defining who the Successor Trustee is and when the Successor Trustee assumes by defining incapacity in the trust. Because the trust is a revocable living trust, assets can be transferred in and out of the trust with ease and Successor Trustees can be changed by you at any time, making it an ideal incapacity planning tool.
Contact an Overland Park Revocable Living Trust Attorney
For additional information, please join us for an upcoming FREE seminar. If you have additional questions or concerns regarding the use of a revocable living trust as an incapacity planning tool in Kansas, Missouri or Oklahoma, contact the experienced Overland Park trust attorneys at Parman & Easterday by calling 405-843-6100 or 913-385-9400 to schedule your appointment today.